Page 13 - 2019-20 Annual Report and Financial Statements

DIOCESE OF CHICHESTER ACADEMY TRUST TRUSTEES' REPORT (CONTINUED)
FOR THE YEAR ENDED 31 AUGUST 2020
The restricted fixed asset fund is £668,152 (2019: £244,340) which consists of carried forward grant income. Details of funds held at the year end are included within the financial review section above.
Disclosure of funds in deficit is also included in the Funds Note in the financial statements (note 18).
Investment policy
The Board is committed to ensuring that all funds under its control are administered in a way that promotes best practice, good stewardship and minimises risk. As the Trust grows and it is more likely that cash flow variations mean that it may be temporarily holding balances, for example specific capital projects, or pending decisions on future conversions, cash balances may at times warrant consideration of investment, however, the Trust does not currently consider the investment of surplus funds as a primary activity. As the Trust grows, it does expect to maintain larger balances and has therefore contracted a Wealth Manager, Carpenter Box LLP, to provide investment advice to the trustees in line with the administration objectives outlined above. It is anticipated that during the 2020-21 year, the treasury function of the Trust, undertaken by the Trust's Head of Finance, will evolve to maximise returns within the remits of the principle of risk management and good stewardship.
Principal risks and uncertainties
The trustees have assessed the major risks to which the Trust is exposed, in particular those related to the operations and finances of the Trust and are satisfied that systems and procedures are in place to mitigate our exposure to the major risks. The Audit and Resources Committee, which met four times during the year, reviewed the Risk Register at each meeting and made recommendations for changes.
A risk register has been established which identifies risks to the Trust and actions to mitigate the risks, The Audit and Resources Committee has terms of reference which include reviewing the risk register at least three times per year and making recommendations as necessary to the board on changes that may be required. In addition, the Board itself will conduct an annual review of the risk register.
The Trustees consider the principal risks facing the Trust to be:
• Reputational - failure to ensure that each school acts in accordance with the Trust's policies and meets its obligations with respect to safeguarding.
• Growth - failure to convert suitable schools into the Trust
• Pandemic (Covid-19) - failure to ensure that there are appropriate recovery plans in place
Financial and risk management objectives and policies
The Trust manages its cash resources, including sufficient working capital, so that all its operating needs are met without the need for short-term borrowing.
Fundraising
The Trust does not use any external fundraisers, or engage in direct fundraising activities.
Plans for future periods
The Trust is cautiously pursuing opportunities to expand in line with its seven-year growth strategy, including attracting good and outstanding schools, both primary and secondary, which it plans to achieve by initial growth within the next two years. Achieving the admission of additional schools is vital to securing financial stability and health for the Trust for future years and ensuring resources continue to be available to support school improvement provision across the wider Trust.
Funds held as custodian trustee on behalf of others
The Trust does not act as a custodian trustee and hold funds on behalf of others.
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